What constitutes a valid assignment of a contract?
What constitutes a valid assignment of a contract?

The following Dispute Resolution practice note provides comprehensive and up to date legal information covering:

  • What constitutes a valid assignment of a contract?
  • When is assignment of contracts relevant for consideration?
  • What is an assignment—by consent, by operation of law, legal or equitable assignment?
  • A simple example of an assignment of a contract
  • What parts of a contract can be assigned—benefit, not burden
  • Delegation and sub-contracting
  • Do you need consent to assign a contract?
  • Express prohibition against assigning
  • Assignment of Receivables
  • Trust
  • More...

This Practice Note identifies what can be transferred when assigning a contract and how to effect a valid assignment of a contract. For guidance on common contract assignment scenarios, see Practice Note: Assigning contracts—common scenarios and considerations.

When is assignment of contracts relevant for consideration?

Contracts are frequently assigned as part of the way companies run their businesses. When advising a party in relation to a proposed or purported assignment (transfer) of a contract where there may be a dispute, you will need to consider:

  1. what, when and how rights can be assigned

  2. how an assignment can be challenged

For detail on how to vary or transfer rights and obligations under a contract by way of variation or novation, see Practice Notes:

  1. When is variation of a contract valid?

  2. Novation—why and how to novate a contract

What is an assignment—by consent, by operation of law, legal or equitable assignment?

An assignment is 'an immediate transfer of an existing proprietary right, vested or contingent from one party to another'.

So, in the context of 'assigning a contract' we are concerned with transferring a party's rights under the contract to someone else. In a contract between (A) and (B), (B) decides to assign their rights under the contract to (C). For example, if (A) has promised to pay £10 to (B), (B) can assign the benefit of that debt to (C), such

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